Correlation Between Amg River and Keeley Small
Can any of the company-specific risk be diversified away by investing in both Amg River and Keeley Small at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Amg River and Keeley Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg River Road and Keeley Small Cap, you can compare the effects of market volatilities on Amg River and Keeley Small and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Amg River with a short position of Keeley Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg River and Keeley Small.
Diversification Opportunities for Amg River and Keeley Small
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Amg and Keeley is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Amg River Road and Keeley Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keeley Small Cap and Amg River is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Amg River Road are associated (or correlated) with Keeley Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keeley Small Cap has no effect on the direction of Amg River i.e., Amg River and Keeley Small go up and down completely randomly.
Pair Corralation between Amg River and Keeley Small
Assuming the 90 days horizon Amg River Road is expected to generate 0.88 times more return on investment than Keeley Small. However, Amg River Road is 1.14 times less risky than Keeley Small. It trades about 0.42 of its potential returns per unit of risk. Keeley Small Cap is currently generating about 0.31 per unit of risk. If you would invest 1,009 in Amg River Road on September 1, 2024 and sell it today you would earn a total of 112.00 from holding Amg River Road or generate 11.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg River Road vs. Keeley Small Cap
Performance |
| Timeline |
| Amg River Road |
| Keeley Small Cap |
Amg River and Keeley Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg River and Keeley Small
The main advantage of trading using opposite Amg River and Keeley Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg River position performs unexpectedly, Keeley Small can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Keeley Small will offset losses from the drop in Keeley Small's long position.| Amg River vs. Amg River Road | Amg River vs. Champlain Small Pany | Amg River vs. Amg River Road | Amg River vs. Marsico Global Fund |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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